An unfair funding system which means West Midlands Police has suffered bigger cuts than other forces could be axed as soon as December, officials have said.

But pressure is now on the Home Office to ensure the new system offers a better deal to cash-strapped forces.

Mark Sedwill, the most senior civil servant in the Home Office, revealed ministers hoped to ditch the existing scheme by the end of this year as he gave evidence to a Commons inquiry which is looking into whether police forces across the country are coping with massive spending cuts.

It would mean funding allocations announced in December for the 2016-17 financial year were calculated under a new system.

Earlier this year, an official financial watchdog confirmed that West Midlands Police was the victim of unfair funding cuts which meant it was hit harder than forces in other parts of the country.

West Midlands Police had suffered funding cuts of 23 per cent, almost a quarter, over the past five years while others had suffered less drastic cuts, said the National Audit Office.

Funding for Surrey Police has fallen by just 12 per cent over the same period.

And the disparity was partly a result of the Government's decision to cut funding from the Home Office by the same proportion for each force - even though some depend far more on Home Office funding while others raise a lot of their revenue from local taxation.

The National Audit Office warned: "Force areas most affected by funding reductions are those with a greater proportion of central government funding."

As a result, West Midlands Police had the second-highest cut of any force in the country.

Earlier this year, it was revealed up to 2,500 West Midlands Police officers and staff were set to be lost over the next four years as the force tried to save a further £120 million.

Speaking to the Commons Public Accounts Committee, Mr Sedwill said it was hoped to have a new system up and running by the end of the year, following a consultation with Police and Crime Commissioners.

He said: "The consultation will happen over the summer. After the consultation, the decisions – the actual allocations by force – will be done, as normal, by December, for 2016-17."

And the new funding scheme would be likely to take into account how much forces were able to raise locally from the council tax precept – as well as issues such as how many pubs they had in their area, which could affect levels of anti-social behaviour.

Responding to the comments, Birmingham MP Jack Dromey (Lab Erdington) said the new formula must be used as an opportunity to introduce fairer funding.

He said: "The West Midlands Police service is on track to suffer a cut of a quarter of a billion pounds, hit twice as hard as Surrey.

"The time has come for fair treatment, to ensure the future of neighbourhood policing. The people of the West Midlands will rightly expect that the Government's review will end past unfairness but we will see."

MPs were also told forces needed to change dramatically to cope with increasing demands to fight online crime and child abuse.